Sihuan Pharma prices second largest healthcare IPO this year

The Chinese manufacturer of cardio-cerebral vascular drugs raises $741 million by pricing its shares at 26.7 times next year's earnings, making it the most expensive new stock to list in Hong Kong this year.

Sihuan Pharmaceutical, a Chinese manufacturer of cardio-cerebral vascular drugs, has pulled off another popular initial public offering in Hong Kong despite a fairly dear price, bucking an earlier trend of companies needing inexpensive valuations to be able to attract a decent amount of funds.

The company raised HK$5.75 billion $741 million after pricing its shares at HK$4.60 apiece, the top end of the indicated range. The price translates into a price-to-earnings PE ratio of 26.7 times, based on projected earnings for 2011.

That is more expensive than L’Occitane, which is said to be the most expensive new stock on the Hong Kong exchange so far this year. The French skincare...

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